Most people, including attorneys, believe that Family Law Judges will always make legal rulings consistent with the law and with common sense. Not so! Even experienced Family Law Judges sometimes make legal rulings that can literally ruin lives.
I believe that sometimes this occurs out of ignorance, and sometimes because the Judge believes that it is “fair” to make a bad ruling, and figures that the aggrieved party won’t go through the expense or trouble of filing a legal appeal (essentially, a request for relief from a bad judgment).
Just this week a very experienced Family Law Judge in a large Northern California county (let’s call him or her “Judge X”) made a shocking ruling: in essence, he or she ordered that a house, which was “upside-down” (worth less than the mortgage) be awarded to one spouse as her sole property, while at the same time ordering that the other spouse remain on the mortgage indefinitely!
Sometimes this is appropriate when there are special-needs children that would be harmed if they lose their family home, but that wasn’t the case here.
Normally when one spouse wishes to “keep the house” they have to show two things to the court: first, that they can pay out to the other spouse their ownership interest in the house (either in cash or by trading items of equal value), and that they can refinance the underlying mortgage in their own name, or otherwise relieve the other spouse from liability for the mortgage.
Why? Because when my spouse gets the house, but my name remains on the mortgage, I am, in legalese, “jointly and severably liable” for the mortgage. This means if my spouse dies, the mortgage company comes after me for 100% of the mortgage. If my spouse files bankruptcy, the mortgage company comes after me for 100% of the mortgage.
And if the house is “awarded” to my spouse, even though I bear the same risk, I don’t own the house: if by next year the house has gained in value, and now has a net value of $100,000.00, that all is the property of my spouse–I get none of it.
Further, if I am liable on the mortgage of my ex-spouse’s house, this will skew my debt-to-income ratio and make it all but impossible for most folks to ever get another home mortgage. Finally, if my ex-spouse fails to make even one mortgage payment on time–suddenly I have the dreaded “30-day late” entry on my credit report, which will instantly wreck my credit rating in most cases.
That is what makes Judge X’s ruling so wrong: one spouse gets all of the benefit of house ownership, while the other spouse gets no benefits, or ownership rights, but bears all of the same risk as spouse number one. It’s like being forced into a business partnership where you get no profit, and no equity if the business is ever sold, but you are 100% liable for the debts!
This is a good example of the risks you run when you put your future, and the future of your family, in the hands of a Family Law Judge, even when he or she is a well-qualified, well-regarded judicial officer–you never know when ignorance, or a personal bias or conviction, can work an injustice.
Mediation is one of the ways that you can gain more control over your divorce so that major decisions are handled by you and your partner, and not left to the sole discretion of a family law judge. To find out more about mediation and other options that can keep you out of court, please contact us and let us help you discover all of your options.